How To Create a Winning Pitch Deck
How To Create a Winning Pitch Deck
People have been fundraising for a long time, and have learned what works, and what doesn’t. Fundraising professionals have tested methods, strategies, and tactics, and seen what helps organizations raise money – and what just wastes time and resources. The key to successful fundraising will always be innovation, market opportunity and the ability for the team to execute.
Seeking investment capital for a startup can be a difficult task—especially for first-time founders. Asking seasoned investment professionals to believe in your product and trust your business plan can be overwhelming. But there are four foundational steps that will make the fundraising quest easier.
Your business or product idea has to stand out.
Business strategy answers the “How?” of a business. It includes concrete goals, detailed steps and an outline of everything from service delivery to sales strategy. The central component of your strategy is the company’s business plan.
Establishing an operationally excellent company shows potential investors that the management team not only has expertise in its industry and domain, but also in how to efficiently run their organization and to carry out their plans as described in the business plan.
Private placements contain an element of risk. That is why investors will look for the management team to minimize volatility and operate at a thoughtful and planned pace.
One of the primary documents essential to any early-stage company fundraising process is a pitch deck. It is a presentation that entrepreneurs and startups founders use to highlight their business, intrigue investors and potentially raise funding to grow their company.
Building an effective and persuasive pitch is incredibly hard and very specific and unique to each company. The key to their universal success is that they focus on creating a captivating and relatable story that connects present and future, helping investors believe that the future is real.
Any sophisticated investor will want to understand four key elements of the business opportunity, which should form the outline of your deck:
Your product overview should be dominated by the answers to two critical questions:
• What unmet market need does your product fill?
• How does your product address the market need in a differentiated manner from the current competitors?
Your pitch deck has to address three critical questions related to the market:
• How big is the addressable market? Do not overstate the addressable market size. It’s very easy to lose credibility;
• What is your company’s market penetration strategy? For most businesses, one of the hardest things to do is acquire customers. Thus, any sophisticated prospective investor will want to understand how you plan to make that happen and the cost you’ve budgeted to achieve the targeted market penetration;
• How much, if any, market traction does the company have? Customer testimonials are one of the most compelling things you can have in your pitch deck. Market survey results are also great, as is feedback from focus groups. Anything you can do to show that real customers actually do, or likely will buy your product is a plus.
Sophisticated investors only invest in businesses if they have confidence and trust in the management team. In order to maximize your chances of raising money, your pitch deck should:
• Explain why the key employees you currently have are the right people for their roles. Include pictures and brief bios and specific skill sets in the people section of pitch deck.
There are three things you need to cover related to money:
• A summary of your financial projections;
• How much capital you’re currently raising and what milestones you plan to achieve with it;
• Projected investor returns;
Pitch decks are often content-heavy, filled with facts and figures about business strategy or concept. So when it comes to making them easier to read and understand, remember you can convey a lot of information very quickly with visuals.
To take your presentation to the next level, there are some best practices and design tips you should keep in mind:
1. Have brand identity
It is important to convey the personality of the business. If you don’t yet have an official fully developed brand, then keep it simple. Choose a two or three-color palette that expresses the brand. Like visuals, color has the power to convey and communicate meanings and messages without words, and can influence how a potential investor might perceive or interpret the personality of the brand.
2. Accentuate numbers with charts
Always consider that your audience is time-poor. It’s your job to make it easy for them by highlighting and emphasizing key figures with charts. Create infographics that convert lists of numbers into digestible images.
3. Reduce and simplify text with icons
Icons can serve two purposes: they put personality into a pitch deck and they convey information quickly and without words (nor mentioning that at the same time they reduce text overall).
4. Compare competitors with an XY graph
Competitor analysis is an important way for potential investors to understand how a new business will fit into an existing market landscape, and can be done on price point, location, and niche. The goal is to show off the business as being better than it its competitors based on the two chosen metrics.
5. Break down information with tiled layouts
Tiled layouts can be used to break large sections of text into smaller sections, making the content easier to read and digest. Simply divide a page into six to ten sections, differentiating the tiles with borders or alternating colors, and a brief summary and icon in each section.
6. Chart milestones on a timeline
Timelines are a visual way to demonstrate project progress, milestones, spending. Again it’s an easy way to read what can be quite dense content otherwise.
7. Show off the team with professional photographs
The purpose of pitch decks is to introduce potential funders to a concept or business idea, and to stoke their interest. The investor’s perception of the founder and/or team behind the business – their passion, commitment and experience – will heavily influence their decision on whether or not to invest. So, introduce the founder and the team with photographs that convey their professionalism, provide relevant information about each team member: their experience, motivation for starting or contributing to the business, what their role will be short and long term and their tasks and responsibilities.
8. Differentiate sections with compelling images
Illustrations can contribute to a more visually compelling pitch deck and help convey content and key messages without words. On a design level, they can also be used to differentiate sections. Dynamic visuals will keep the audience engaged and at the same time will give them a break from text. But remember – be consistent! Assure all similar elements and iconography in your design look and function in a similar way to increase consistency.
In closing, there is no such thing as one perfect pitch deck for all investors. Every prospective investor will have their own unique way of looking at the opportunity. Emphasize the benefits of your idea, show them how it works, present with confidence. And leave a memorable impression on your audience!